KCK plant hopes to pipe in profits

At the request of its customers, a Kansas City, Kan., company has invested $5 million to build a precast concrete pipe plant and compete with local plants owned by national and international competitors.

"We were very much encouraged to get into the pipe-production business," Pretech Corp. President Bill Bundschuh said.

The investment included a high-tech pipe-casting machine from Austria, 10 acres of property and renovations to a 22,500-square-foot building sitting on the property, Bundschuh said.

The company added 12 employees in 2005, bringing its work force to 50. In its first year of operation, the pipe plant helped drive Pretech revenue, which was $93,000 in 1993, to $10 million in 2005, despite the presence of two entrenched competitors in the market, Bundschuh said.

Construction companies have ordered Pretech's pipe for four school and library projects, four road projects, a church, a shopping center, a business park and several private housing projects, Bundschuh said.

From its beginning in 1993, the company has manufactured precast concrete wastewater components, and it is supplying the Sprint Center, Power & Light District and H&R Block Inc. headquarters projects with those products, said Pete Browne, vice president of Kissick Construction Co.

Pretech competes for that business with five other companies' plants in the region. It competes in the pipe business with just two: Hydroconduit, part of Australia-based Rinker Materials, and Kansas City Concrete Pipe, part of Cretex Cos. Inc.

In most markets, concrete products are produced locally because their weight typically makes shipments farther than about 200 miles too expensive, said Matt Childs, president of the American Concrete Pipe Association.

That makes the industry attractive for new businesses willing to invest in labor-saving machinery despite the presence of competitors with plants in multiple cities, Childs said.

"I would say in the United States, we have probably five or six startups a year," he said.

But big players are buying up small operations. Since 1990, Rinker has grown from 45 plants to more than 65, Childs said, and the largest manufacturer has 85 plants. Cretex has 18 plants nationwide.

Pretech's entry into the pipe market was financed in part with loans from First National Bank of Olathe and included the purchase of a computerized pipe-casting machine made by Austria-based Schlüsselbauer Technology GmbH & Co. KG, Bundschuh said.

The company also invested in wire machines capable of spinning out reinforcement grids that use less metal than Pretech's previous method for incorporating wire in its products, he said.

Browne said Kissick was among the companies that encouraged Pretech to expand into the pipe business because Kissick felt comfortable doing business with the locally owned company.

Having a third supplier also fattens the local inventory of high-quality pipe in various sizes, Browne said, making construction purchasers' lives easier.